Question

21 Apex’s ABC activity information is as follows: total cost total activity activity rate customer orders 315,000 1000 orders product design 257,000 200 designs order size 380,000 20000 machine hours customer relations 367,500 100 customers other 490,500 n/a Compute the activity rate for all applicable activities above.

1. Apex manufactures 2 models of sailboats, the standard and the deluxe.

standard boat	activity rate	activity	ABC cost allocation
customer order		2 orders
product design		0 designs
order size		200 machine hours
customer relations		n/a
deluxe boat		activity
customer order		1 orders
product design		1 designs
order size		100 machine hours
customer relations		n/a

Use the activity rate from above in #21 in the activity rate column. Compute the ABC cost allocation above.

Understanding the step process is where I'm struggling most.

Answer 1

Computation of Activity Rate
	Estimated Cost (a)	No. of Activity (b)	activity rate (a/b)
customer order	$315,000.00	1000	$315.00
product design	$257,000.00	200	$1,285.00
order size	$380,000.00	20000	$19.00
customer relations	$367,500.00	100	$3,675.00
Standard Boat	activity rate (a)	activity (b)	ABC Cost Allocation (axb)
customer order	$315.0	2 orders	$630.00
product design	$1,285.0	0 designs
order size	$19.0	200 machine hours	$3,800.00
customer relations		n/a
Deluxe Boat	activity rate (a)	activity (b)	ABC Cost Allocation (axb)
customer order	$315.0	1 orders	$315.00
product design	$1,285.0	1 designs	$1,285.00
order size	$19.0	100 machine hours	$1,900.00
customer relations		n/a